A tech-support call starts it all. Why is my application running slow? What happened to my spreadsheet data? Is HQ using a 56K modem to handle traffic for my branch office -- again? The number of calls suddenly increases, and network analysis reveals unforeseen usage spikes at a new marketing location. The dream of data-center consolidation turns into a nightmare.

IT managers at large companies with many branch offices or retail locations increasingly are relying on WAN optimization to address slow application performance over sagging, slow and overused networks. Yet, because these same companies are so distributed, implementing a comprehensive strategy to resolve network congestion issues isn't easy. In addition, upgrading switches and carrier lines can be prohibitively expensive.

The emerging answer

Enter managed WAN-optimization services. A host of providers including AT&T, BT Global Services and Verizon Business have beefed up their managed-services portfolios with options for boosting application performance over their networks.

The services perform the same duties as a WAN-optimization appliance from such companies as Citrix Systems, Riverbed Technology or Silver Peak Systems, yet offload the installation, configuration and maintenance chores to the hosted provider. Managed WAN-optimization services address unresponsive applications, slow transmissions and network congestion; more and more they also are providing relief for companies that don't have a dedicated network-optimization staff or the time to tweak applications for improved performance.

Like its hardware-based alternative, a managed WAN-optimization service can help a company avoid bandwidth upgrades. Such was the case at Denso Thermal Systems, a Turin, Italy-based automotive-parts maker that avoided massive upgrades at 14 sites in three countries by using a WAN-optimization service from Orange Business Services. Orange's Business Acceleration suite offers analysis, through which Denso established optimization priorities for mission-critical applications, plus management and optimization through data compression, traffic-shaping and other techniques.

"We thought we would need to upgrade sites in order to improve application performance," says Silvio Bonetto, IT director at Denso. "Instead, traffic is optimized though the Orange Business Acceleration offering."

Large companies like Denso choose managed WAN-optimization services over in-house appliances for several reasons, says Joe Skorupa, a Gartner expert on WAN optimization. One reason is tactical: A WAN-optimization service can adjust quickly to organizational needs. It scales with expansion and gives IT managers more flexibility to solve physical network slowdowns while avoiding the high expense of retrofitting branch offices with WAN-optimization appliances. For example, if a retailer decides to open several new stores internationally but bandwidth is prohibitively expensive, IT can use a managed WAN-optimization service to get desired throughput for point-of-sale applications.

In addition, the decision can be one of capital expense vs. operational cost, Skorupa says. Adding WAN optimization to an existing service is just another item on an expense line -- as opposed to a capital expense, which requires approval.

Avoiding a capital expenditure was what drove US-based Sensata Technologies to managed WAN-optimization. The company, which makes sensors and controllers for the automotive, manufacturing and airline industries, potentially faced spiraling costs as it planned how to address network congestion at 46 sites worldwide. At some locations, costs for deploying a faster physical line to the building would have been exorbitant.